Introduction

Statistics Canada regularly publishes macroeconomic indicators on household income, consumption and saving as part of the quarterly System of Macroeconomic Accounts (MEA) and as part of the Provincial and territorial economic accounts (PTEA). These accounts are aligned with the most recent international standards and are the source of estimates of national income, consumption and saving for all sectors of the economy, including households, non-profit institutions, governments, corporations and the non-resident sector. While the MEA provide high quality information on the overall position of households relative to other economic sectors, they lack the granularity required to understand vulnerabilities of specific groups and the resulting implications for economic wellbeing and financial stability.

There is a growing recognition, both in Canada and internationally, that building distributional dimensions into household macroeconomic indicators is becoming increasingly important. If information on disparities among households is consistent with macroeconomic indicators, it enriches the understanding of economic developments and allows for a fuller assessment of the risks associated with for example, rising inequality of income, consumption, saving and wealth.

Recent comprehensive revisions to the Canadian System of Macroeconomic Accounts published in 2012 and 2015 better positioned the macroeconomic statistical program to undertake this work. Changes were introduced to align measures with new international standards, including the creation of a separate sector for non-profit institutions serving households, (previously included in the household sector) and the measurement of employer-sponsored pensions on an entitlement basis. More detail on the changes made during the revisions in 2012 and 2015 can be found in Revisions analysis - Canadian System of National Accounts 2012 and Results from the 2015 Comprehensive Revision to the Canadian System of Macroeconomic Accounts.

This documentation describes the sources and methods for the compilation of estimates of Distributions of household economic accounts (DHEA) for income, consumption and savings on a national and provincial and territorial basis. Distributions for social transfers in kind, as well as for wealth are also produced and are part of the DHEA ongoing statistical program. More detail can be found in the sources and methods guides related to household actual final consumption and for wealth.

The documentation is organized as follows: the following two sections describe the primary data sources used to establish household distributions of income, consumption and saving, including: the Social Policy Simulation Database and Model (SPSD/M), which integrates household survey data with data on government program spending and income tax revenues; and the Survey of Household Spending (SHS), which supplements the aggregated consumption data available within the SPSD/M with more detailed information on household expenditures that are cross-referenced by economic and demographic characteristic. The subsequent section describes the general estimation process to convert the SPSD/M and SHS data into MEA concepts, which follows recommended international practice. The section after describes the estimation process for sub-annual distributions of household economic accounts and the sources, methods, assumptions and limitations. The final section provides an overview of future efforts to develop the DHEA estimates.